Figure 12-3 -Refer to Figure 12-3. If the Aggregate Demand Curve Is

question 10

Multiple Choice

Figure 12-3
-Refer to Figure 12-3. If the aggregate demand curve is AD₁, which of the following is the most
Appropriate discretionary fiscal policy to pursue?

• A) a contractionary fiscal policy involving reductions in government spending and increases in income tax rates
• B) a contractionary fiscal policy involving reductions in government spending and decreases in income tax rates
• C) an expansionary fiscal policy involving increases in government spending and increases in investment tax credits
• D) an expansionary fiscal policy involving increases in government spending and decreases in investment tax credits

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Definitions:

Venture Capitalist

An investor who provides capital to startups or small businesses with high growth potential in exchange for equity or partial ownership.

Promising Venture

An enterprise or venture that shows a lot of potential for success and growth due to its innovative approach or market position.

Prototype

An early sample, model, or release of a product built to test a concept or process or to act as a thing to be replicated or learned from.

High-Technology Inventor

An individual or group involved in creating innovative products or systems that rely on advanced scientific and engineering knowledge.